A demand letter is the cheapest tool that works. It is a formal, dated letter that lays out exactly what you are owed, sets a firm deadline, and spells out what happens if they do not pay. Send it by certified mail with a return receipt. It often gets you paid on its own, and even when it does not, in many states it starts the clock on the interest they owe you. Here is exactly what to put in it.
What goes in it
Keep it plain and complete:
- Both parties' full legal names and addresses.
- The invoice number and date, so there is no confusion about which bill.
- The exact amount owed, plus any late interest your contract or state law allows.
- A specific deadline to pay. Seven to ten business days is standard. A real date, not "as soon as possible."
- What happens if they do not pay: a mechanic's lien, small-claims court, or an attorney, whichever fits.
- Copies of the contract and the invoices attached, and everything else that turns your account of the job into a paper one: the signed change orders, the delivery tickets or signed timesheets, dated photos of the completed work, and the emails or texts where they approved the work or acknowledged the balance. Attach the approval, not just the bill. A letter that arrives with the whole story attached is much harder to ignore than one that asserts it, and if this does end up in front of a judge you have already assembled the file.
Check the lien clock before you pick the date
Set the deadline against your lien calendar, not just against what feels reasonable. Your right to file a mechanic's lien, and in many states the preliminary notice or notice of intent that has to come before it, runs on a fixed number of days from a fixed event, and those deadlines do not pause because you are being patient. A generous thirty-day demand on a balance whose lien deadline falls in three weeks is not generosity, it is giving away the only leverage you had, and no amount of politeness gets it back afterwards.
So do it in this order. Find your lien and notice deadlines first, in Working in Your State. Then set a demand deadline that lands comfortably before the earliest of them, which is usually why seven to ten business days is the standard rather than a month. If the lien clock is genuinely about to run out, file or serve the notice first and send the demand alongside it. Preserving the right costs you nothing and you can always choose not to use it.
The notice of intent to lien: the letter that gets you paid before you file is the sharper version of this same letter, and the two are easy to confuse. A demand letter is a private request between you and the customer. A notice of intent is a formal, often statutory warning that a lien on their property is next, and it is the one that tends to move a customer who has been ignoring you, because it reaches their lender and their title. Many contractors send the demand first and the notice of intent second, and there is nothing stopping you doing both in the same week. Keeping the right alive in the first place is The preliminary notice: the paperwork that keeps your lien rights alive.
Send it the right way
Use certified mail with return receipt, so you have proof they received it, and keep a copy for yourself. That receipt matters if this ends up in front of a judge.
Keep the tone flat
Firm and factual, not angry or threatening. Assume a judge will read it one day, because they might. A calm letter that simply states the facts, the amount, and the deadline is far more effective than a furious one, and it makes you look like the organized party in the room.
Why it works
Most late payments are not real disputes, they are people hoping you will let it slide. A proper demand letter tells them you will not, and that the next step is a judge, not another phone call. That alone shakes a lot of money loose. And in many states, the letter starts the clock on prejudgment interest, so the longer they wait, the more they owe.
The move
Send the demand letter before you file a lien or go to court, subject to the lien clock above. It is the step that often makes those unnecessary. Where it sits in the whole sequence, from a phone call to an attorney, is set out in Not been paid? Here's your ladder of options., and if the letter is ignored, Mediation, arbitration, or court: where your dispute actually goes is how you pick the next rung. If you do have to escalate, the same letter on an attorney's letterhead hits harder, because now the debtor knows a lawyer is already involved.
Common questions
How long should I give someone to pay a demand letter?
Seven to ten business days is the standard deadline, and it should be a real calendar date, not "as soon as possible." A firm date shows you are serious and starts a clear clock toward the next step. Give them enough time to actually cut a check but not so long that the letter reads as a bluff. Whatever date you set, be ready to follow through on the consequence you named the day it passes.
Do I have to send a demand letter before I sue or file a lien?
A demand letter is not always legally required before small claims or a mechanic's lien, but it is the cheap step that often makes both unnecessary, so send it first. Some contracts and some states do require formal notice before you can escalate, and mechanic's liens have their own separate notice rules and deadlines. Check your contract and Working in Your State, and send the demand either way, because most late payments shake loose at this stage.
Should a lawyer send my demand letter?
You do not need a lawyer to send a demand letter, and a clear one you write yourself works fine for most balances. The same letter on an attorney's letterhead hits harder, because the debtor now knows a lawyer is already involved, so for a large or contested amount it can be worth the cost. Start with your own letter, keep it flat and factual, and escalate to an attorney's version if it is ignored.
Does a demand letter start interest running?
In many states, a written demand can start the clock on prejudgment interest, so the longer they wait to pay, the more they owe. The rate and the rules for charging interest vary by state and by what your contract says. Because it is state-specific, confirm what interest you can add in Working in Your State, and state the running interest in the letter so they know the bill grows every week they stall.
The honest bit
- Do not threaten action you are not prepared to take. If you say "small claims by Friday," mean it.
- Small-claims limits and the interest you can charge vary by state. See the Small Claims tool and Working in Your State.
- This is general guidance, not legal advice. For a large or contested balance, an attorney's demand carries more weight and keeps your options open.
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